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The Price Of Oil - Page 15

1st, let's gp back a few years. Are you old enough to remember "Tricky Dick" Nixon? Do you remember him slapping price controls on prices and wages across the nation? I do. I also remember that the controls didn't last till the water got hot, EXCEPT the control on oil. Gasoline at that time was about 39 cents a gallon the best I remember. Then somebody in the oil industry remembered the old rule that has been poured in stone since time began. "The price of anything depends on the law of supply and demand." Except, (there's always an exception) when government gets involved. So the oil companies created a "shortage." And what happens to the price when everybody's world turns because there's gasoline? It goes up of course! That lie worked so well that they did it again, and again, and they blamed it on the Exxon Valdeez, or the Saudi's, or some dictator somewhere.

Now if I owned an oil company, or just stock in one, I would want profits as high as possible. What I am very tired of is being lied to about why the price is up. It goes up every spring for school vacation time and back down every fall when vacation travel slows.

And as to the reason local prices fluctuate more than others, three states are considered vacation states, so California, New York, and Florida have the highest demand and generally pay the highest prices. Another reason your price in your immediate area is what it is (and I got this from a three station owner) is because a group of owners ( illegally, but prove it ) set the price locally depending on the economy and demand in that area. They charge all they think they can get away with.

Have you ever considered that the oil company does the exploration, drills thousans of feet, hauls it, refines it, and hauls it to your station for about 8 cents a gallon, and city, county, state, and federal governments together get 50 cents from every gallon and they don't do anything but stand there with their hand out?

In 1956 my high school sweetheart ( later my wife ) would come where I worked, borrow my 48 maroon Ford convertable. Then her and her girlfriends would pool their leftover lunch money to buy a 29 cent gallon of gas and have a ball running all over town. 29 cent gas is long gone and so is my wife of 30 years.

Edited: mousetrails on 28th May, 2007 - 10:15pm

Oil Price The

Although, the oil companies are making record profits. If you take a look at the price per barrel, the pump price I become a bit more confused at why the oil companies weren't raking in more profits long ago. In 1977 the price of a barrel was about $15 on average. At that price, we were paying about $1.40 in the US for a gallon of gas. Today, we have a price of $3.20 for a gallon of gas with a oil barrel running at about $65.20. That is a little over 4 times the price per barrel of oil, but significantly less percentage increase in the gas increase. A straight scale up of the barrel price would have us paying about $6 per gallon. I suspect that there has been some significant improvements in refining and drilling techniques that can account for the record profits with a more expensive raw material, otherwise I wonder why they didn't have the huge profits way back in the 70's. This is just straight figures and there were no adjustments made for inflation or increases in taxing that have occurred.

Now this is not to say that there are not some people taking advantage of the very unstable oil price. The string of people involved in getting oil to you seem to be taking their penny here and a penny there during this time and it is obvious and it shows in the oil companies financial reports. Pennies in the gas game mean huge profits as we all use many gallons in the US society. If you become complacent about paying more, then they will allow you to do so. Therefore, it is great when some stand up for what is just and hold others to that measure.

The Price Of Oil History & Civil Business Politics

Protesting the price of gasoline going up is like protesting inflation. To whom do you really point the finger of blame?

OPEC? Oil corporations? Price fixing? The government?

There really are no simple solutions to this, but the best way to cut prices is to cut demand. As Krakyn says, get a bike.

Vote/protest with your wallet.

Page 15 Oil Price The

OIL HITS RECORD $80 US A BARREL

Oil prices waded into uncharted territory above $80 US a barrel Wednesday after the U.S. government reported a big drop in crude oil inventories.
Ref. https://www.cbc.ca/story/money/national/2007/09/12/oil.html

Oil Price The

Interesting that this comes on the heels of Saudi Arabia announcing an increase in OPEC output.
https://www.bloomberg.com

Increase in production should equal a price reduction, not an increase.

The Price Of Oil

Should, but the news about lower than expected stock levels of oil in the nations of the world drove the price higher to offset it. Higher production does not result in immediate inventory stock.

The Price Oil - Page 15

Not lower inventory in the world, just crude stock in the U.S. I'm aware that an increase in production doesn't magically produce an increase in inventory. But who's watching the dipstick of the crude inventory level? It's up, it's down, it's up, it's down, and every single time it's a big surprise to whomever makes the announcement and the price per barrel goes wild. Ridiculous manipulation, in my opinion.

The Price Oil Politics Business Civil & History - Page 15

My point is that inventory levels affect the price of crude, and that it was enough to offset the increase in OPEC production. There is a lot of speculation. The article you pointed to states:

* the increase is likely too little - too late, due to the approaching winter, I.e., inventory levels.

This article points out that the low inventories were a significant reason for the price increase, despite the OPEC production increase:

https://www.abcnews.go.com/Business/wireStory?id=3591363

And this article points out other problems, including:

* production problems with Texas,
* another tropical storm brewing in the Gulf, and
* a natural cycle of high oil prices in September (due to the coming winter).

So in essence, while increasing production at the well head certain helps to lower the price of crude, there are a LOT of other factors that can easily offset it. If OPEC had NOT increased production, then I would expect that the price of crude would have gone up even higher.

https://www.msnbc.msn.com/id/12400801/

Edited: tortdog on 14th Sep, 2007 - 12:44pm